UoB Hosts Discussion On Local Birmingham Funding

The University of Birmingham (UoB), in partnership with the Institute for Fiscal Studies (IFS), hosted an event discussing funding for local services on November 7th

The UoB event was chaired by Professor Simon Collinson, Deputy and Pro-Vice-Chancellor for Regional Economic Engagement for the University. He introduced the event saying how pleased he was that UoB was able to host such an important event, given the political shift towards more local government and a less centralised economy which has taken place in recent years, since the appointment of George Osborne as Chancellor of the Exchequer in 2010-2016.

‘The devolution agenda in the UK is happening as we speak and in a sense there’s massive questions around whether government will devolve any power or any funding to the UK regions,’ Collinson told the audience, adding that the UK has one of the most centralised systems compared to other countries within The Organisation for Economic Co-operation and Development.

David Phillips, Associate Director at the IFS, discussed the general opinion of the British public which looks for local control as well as consistency in services nationwide such as health services and education.

‘While people like the idea of more local control and power, they also quite like the idea of there being the same provision broadly of services around the country. That is, they quite like the idea of consistency and they don’t like postcode lotteries,’ Phillips said.

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People are struggling with devolution because really do care about having more control over local service

Localisation of funding gives a voice to local voters but can lead to a ‘postcode lottery’, meaning that people living in different areas of the country may have access to better services than others. Postcode lotteries can affect services such as schools, social care, health care and rubbish disposal.

Among academics this is known as the ‘devolution paradox’, people wanting control but not necessarily that resulting in differences across each region.

‘People are struggling with [devolution] because really do care about having more control over local service, more control over what happens in the local area but they also do care about things being consistent the country, they do care about some sort of common standard’.

Postcode lotteries are also determined by the amount of money the council can raise through council tax. Phillips said that in Birmingham Solihull can raise 1.5 times more than Sandwell, which can result in a postcode lottery.

The West Midlands, under control by Mayor Andy Street, is a combined authority formed part of devolution and encouragement from central government for councils to band together. Street has powers over transport, economic development, housing delivery, adult skills and long-term unemployment. This was done to help local areas improve their areas to improve their economy, for instance improving transport so people can access jobs more easily.

Despite this looking like more power is being given to local authorities, Phillips said that there has been trend of centralisation in areas such as school and social care. Funding for these two areas comes from central government and must be spent on that area. Councils can still decide how much goes towards each school. However, plans are in discussion for councils to issue the same amount of funding to each school regardless of pupil numbers and needs.

‘The government seems to think [that the] councils’ [...] strength lies in knowing what’s going to help the local economy, and actually on the other hand there should be more national standards when it comes to big public services,’ Philips said.

It seems that whilst councils are allowed to control transport and other services, larger and arguably more important areas such as education and care have national standards that councils need to comply with. Whilst this takes away from local power, it is necessary that these services be controlled nationally to ensure a standard across the country.

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There should be more national standards when it comes to big public services

Phillips then opened up to a panel of speakers. On the panel were Jonathan Tew, Assistant Chief Executive of Birmingham City Council, Emma Woolf, Chair of Birmingham Community Matters and Chair of Birmingham Open Spaces, and finally Professor John Fender, The Department of Economics, University of Birmingham.

Tew located himself a fan of localised spending. He underlined the fact that we need 'genuine local involvement' in politics for devolution to be successful, adding 'I think we’ve lost a local audience in local government.'

The councilman also discussed youth engagement and the need for young people to get involved with local politics, especially students. ‘I think we’ve lost a younger audience in local politics,’ he said.

John Fender, of the University of Birmingham, shared a very different point of view. To some extent he agreed with localisation of government stating that: ‘I am sympathetic to the idea that if people in a locality wish to increase their spending on a local service and are willing to pay for it themselves by extra local taxation they should be able to do so’. However, he suggested that this should be for smaller scale issues such as rubbish collection. If local people wish to have their bins collected more regularly and are willing to pay for the service, it is a local level decision that they should have the power to make.

However, Fender maintained that larger scale decisions should be reserved for a centralised government. He is concerned by what he terms ‘local political imperfections’. He used the example of a London Borough where all 54 local councillors, as well as the local mayor, belong to the same party. An arrangement such as this is not a satisfactory one and surely isn’t a true democracy, he argued.

Fender introduced the idea of reform to the local political system in the hope of making it a more democratic system. He also highlighted the importance of local people paying their taxes. ‘If most people don’t pay the tax [...] then there’s a risk that those who don’t pay the tax will always vote for more public services since they don’t pay for it and we get an excessive level of local spending’. This would cause obvious problems for local government resulting in debt and an inability to pay for necessary services.

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I think we’ve lost a younger audience in local politics

Fender advocated for the taxing of property as a way of regulating local taxes. That way, it is easy to determine who should pay tax to which local authority as property doesn’t move, he suggested. Council taxes haven’t been reformed in 27 years. For Fender, ‘reform is urgent’.

The final panelist to speak was Emma Woolf, someone whose work is inextricably linked to local government and reliant on the funding provided by Birmingham City Council. Woolf, like Tew, is in favour of localising government as ‘what works for one service won’t work for another service’, she described herself as being at ‘the sharp end’ of local government spending.

She felt unenthused about the current state of government and how little spending local initiatives have.

The event was closed with remarks from David Phillips who, while unsure about the direction that local government will progress in, called for ‘stronger local media’ and ‘stronger local public debate’.

This event was part of the ESRC Festival of Social Science. In its 16th year, the festival provides an opportunity for social scientists to debate and discuss their research, and for members of the public to engage with their research. The festival is run by the Economic and Social Research Council and features over 300 free events across the country.